1

Question 1

Transfer risk

Answer 1

When a consumer purchases insurance

Question 2

Risk

Answer 2

Probability of a potential loss

Question 3

Pure risk

Answer 3

Result’s in either a loss or no change in status

Question 4

Speculative risk

Answer 4

may result in a loss gain or no change in status

Question 5

Loss

Answer 5

Reduction, decrease in value that affects someone’s property or financial position

Question 6

Peril

Answer 6

Fire , lightning , wind , death are commonly covered

Question 7

S.T.T.A.R.R

Answer 7

Sharing , transfer. Avoidance , Reduction , Retention // are methods of managing risks.

Question 8

Homogeneous units

Answer 8

Large numbers with exposures to help predict future losses

Question 9

Statistically calculable

Answer 9

Premium must be affordable for consumer

Question 10

Accidental

Answer 10

The loss must be uncertain

Question 11

Measurable

Answer 11

Verifiable in terms of amount,cause place and time

Question 12

Law of large numbers

Answer 12

To accurately predict the expected losses of a group

Question 13

Adverse selection

Answer 13

For risks that are hard to insure

Question 14

Private insurers

Answer 14

Can write insurance on profitable basis , carries non-governmental entities

Question 15

Government insurers

Answer 15

Social security, Medicare programs , NFIP , Federal Crop , terrorism Risk program

Question 16

Type of insurers (stock company)

Answer 16

Owned by stockholders, share companies profits and receive taxable corporate dividends are not guaranteed

Question 17

Mutual insurance company

Answer 17

Owned by policyholders who may be referred to as members of the

Question 18

Self insurers

Answer 18

Large employers with stable cash flow

Question 19

Insurer domicile

Answer 19

Referes to jurisdiction state , district, or country

Question 20

Domestic insurers

Answer 20

Organized under the law of this state, whether or not it is admitted to do business with this state

Question 21

Foreign insurer

Answer 21

is an insurance company that is based in the United States but sells policies in a different state

Question 22

Alien insurer

Answer 22

insurance company that sells insurance in a country other than the one it is domiciled in. For example, a Bermuda insurer is considered an alien insurer from a US perspective.

Question 23

Admitted insurers

Answer 23

Authorized to transact insurance in a given state will be granted a certificate of authority

Question 24

Non-admitted insurers

Answer 24

Not authorized to transact insurance ina given state

Question 25

Surplus lines insurers

Answer 25

Can insure risks in states it is not admitted in coverage cannot be obtained from admitted insurers

Question 26

Actuarial Department

Answer 26

Gathers and interprets statical information to determine the probability of a loss

Question 27

Underwriting department

Answer 27

Responsible for selecting risks and selecting a specific rate that applies to those in risk nd determining the actual policy premium for applicants

Question 28

Premium

Answer 28

The total costs for the amount of insurance purchased by the insured.

Question 29

Insurance application

Answer 29

The primary source of information about the purchaser needed for the insurer to underwrite a risk.

Question 30

Financial ratios

Answer 30

Used to measure the profitability of an insurance company

Question 31

Reserves

Answer 31

Are ways insures maintain solvency and prepare for their financial obligations to policyholders by setting aside certain amounts

Question 32

Principal

Answer 32

Insurance company

Question 33

Agent

Answer 33

A producer operating

Question 34

Expressed authority

Answer 34

to solicit, negotiate, and sells insurance contracts on behalf of principal

Question 35

Implied authority

Answer 35

Necessary, reasonable, and usual for the producer to perform stated duties

Question 36

Apparent authority

Answer 36

legal concept that describes when a third party believes an agent has the authority to act on behalf of a principal, even if the principal did not give them that authority

Question 37

Fiduciary duty

Answer 37

Agent who handles insurer financial funds in a trust capacity

Question 38

Agent’s responsibility to the applicant/insureds

Answer 38

To have ethical duty to serve their best interests of those.

Question 39

Broker

Answer 39

A licensed individual who negotiates insurance contracts with insureds on behalf of the insurance applicant

Question 40

Insurance service office (ISO)

Answer 40

Providing research and documented info , on which insurers may base their coverage

Question 41

Federal regulations

Answer 41

Oversight impacting insurance practices

Question 42

FCRA

Answer 42

Protects the consumers right to privacy of credit and financial information, ensuring that all data collected is confidential, accurate , relevant , and properly used for specific purpose.

Question 43

Adverse action and disputes

Answer 43

Any adverse action taken by the insurance company is not finalized until the investigation is completed

Question 44

Identify theft and fraud alerts

Answer 44

Must include fraud alerts in the consumers file for at least 90 days.

Question 45

GLBA

Answer 45

To ensure the confidentiality of the consumers information and protect that information from security threats

Question 46

TRIA

Answer 46

Protects consumers by addressing market disruptions and ensuring continued widespread availability and affordability of p&c insurance for terrorism risk.